Amazon FBA Fees & Taxes

Selling on Amazon can be highly profitable — but only if you fully understand the fee structure and tax obligations involved. Many new sellers underestimate their true costs, leading to pricing mistakes or compliance issues.

This guide consolidates insights from the Jungle Scout Power Feature Series video (hosted by Greg Mercer), along with additional research to cover both fees and taxes — providing Amazon sellers with a complete, actionable reference.

Part 1: Amazon Seller Fees Explained

The Jungle Scout video clearly outlines the primary Amazon seller fees:

1. Subscription Fee

  • $39.99/month for a Professional Seller Account.
    (Required if you plan to sell more than 40 items/month or want advanced selling features.)

2. Referral Fees

  • Amazon charges a commission fee on each sale.

  • Typical rate: 15% per order, but category rates can range from 8% to 45%.

  • Example: Electronics is often 8%; certain luxury categories can be much higher.

3. Fulfillment Fees (FBA / Pick & Pack Fee)

  • If using Fulfillment by Amazon (FBA), you pay per-unit fees.

  • Typical range: $2 to $10 per order, depending on:

    • Item size and weight

    • Packaging complexity

    • Shipping requirements

4. Additional Seller Fees

Storage Fees

  • Monthly fee for inventory stored in Amazon warehouses.

  • Calculated per cubic foot.

  • Higher rates apply during Q4 peak season (October to December).

Long-Term Storage Fee

  • Charged semi-annually on inventory that remains unsold after 181 days or more.

  • Incentivizes sellers to manage inventory turnover efficiently.

Return Fee

  • Incurred when an item is returned by the customer.

  • Amazon often charges a handling fee (especially for FBA returns).

5. Indirect Business Expenses

The video highlights other important costs (not direct Amazon fees) that must be budgeted:

  • Travel (for trade shows, supplier visits)

  • Payroll (staff, virtual assistants)

  • Inventory Costs (product sourcing and production)

  • PPC Advertising (Amazon ads, external traffic)

  • Shipping (inbound freight to Amazon, or outbound if FBM)

6. Example Product Cost Breakdown

The video provides a helpful example for a product priced at $67.99, demonstrating how various fees and costs impact net profit margin.

Key takeaway: Sellers should carefully model all costs — including indirect ones — to maintain profitability.

Part 2: Amazon Seller Taxes Explained

The Jungle Scout video touches briefly on taxes — but here is a more complete view:

1. Sales Tax (US) / VAT (UK and EU)

United States — Sales Tax

  • Marketplace Facilitator Laws: In most states, Amazon automatically calculates, collects, and remits sales tax on your behalf.

  • Sellers generally do not need to file sales tax returns for these states.

  • However, if you have nexus (physical presence or inventory stored in certain states), you may still need to register in those states and file tax returns.

United Kingdom / European Union — VAT

  • Amazon generally collects and remits VAT in the EU and UK.

  • Sellers may still be required to:

    • Register for VAT in certain countries.

    • Submit periodic VAT returns.

    • Pay import VAT on goods entering Europe (if using European FBA).

2. Income Tax

  • Sellers owe income tax on their business profits.

  • Amazon does not withhold income tax.

  • Obligations vary by country:

3. Import Duties and Tariffs

If sourcing products from outside your home country (e.g., importing from China):

  • You will likely owe:

    • Import duties

    • Customs clearance fees

    • Import VAT (Europe/UK)

  • These should be included in landed cost calculations.

4. LLC Formation, EIN, and Banking (US context)

The video also provides practical tips for US sellers:

  • LLC Formation:

    • Recommended for liability protection and separating personal vs. business finances.

    • Not required initially, but advisable for serious sellers.

  • EIN (Employer Identification Number):

    • Required for business bank accounts, payroll, and tax filings.

    • Obtainable for free from the IRS.

  • Dedicated Business Banking:

    • Strongly advised: keep business and personal finances separate.

5. Bookkeeping & Profit Tracking

  • Proper bookkeeping is essential for:

    • Accurate income tax reporting.

    • Managing cash flow.

    • Tracking profitability by product.

  • Fetcher (demoed in the video) or Jungle Scout Sales Analytics can simplify:

    • Importing sales data.

    • Tracking COGS.

    • Generating Profit & Loss statements.

    • Managing deductions and expenses for tax purposes.

Part 3: Summary of Jungle Scout Power Feature Series Highlights

To complement fee and tax understanding, Jungle Scout introduced several new tools:

Sales Analytics Section

  • Dashboard for sales, expenses, and profit tracking.

Profit Overview

  • Company-level and product-level profitability metrics.

  • Simplifies analysis compared to Seller Central reports.

Detailed Cost Breakdown

  • Shows specific costs: fees, COGS, shipping.

Product-Level Performance

  • Drill down into individual product trends and performance.

Manual Cost and Income Entry

  • Supports:

    • One-time expenses (photography, samples)

    • Recurring expenses (software)

    • Non-Amazon income (Shopify, local sales)

Shipment and Inventory Tracking

  • Improved visibility into pending units and inbound FBA shipments.

Historical Data Import & Comparison

  • Import up to two years of Amazon data.

  • Analyze trends and performance over time.

PPC Data Integration (Coming Soon)

  • Automated import of Amazon PPC data into dashboards.

All-in-One Tool Strategy

  • Jungle Scout aims to replace the need for multiple subscription services.

  • Emphasis on confidentiality and security — passed Amazon’s audit.

Jungle Scout Academy

  • Extensive educational content to support sellers.

  • Modules now include advanced analytics training.

Amazon, Fees, Taxes, Amazon FBAFrancesca Tabor